Town Square

Post a New Topic

Tempers flare over renter protections

Original post made on Sep 11, 2018

Palo Alto’s heated debate over renter protection turned bitter and personal on Monday night, as City Council members exchanged insults and accusations before reaching a compromise that left most feeling dissatisfied.

Read the full story here Web Link posted Tuesday, September 11, 2018, 3:32 AM

Comments (96)

66 people like this
Posted by Say Yes to Protecting Renters
a resident of Crescent Park
on Sep 11, 2018 at 3:55 am

The majority of Santa Clara County residents already live in cities with rent control. The Democratic Party of California endorses it. A 2017 survey of likely California voters found that 60% support rent control.

Yet in Palo Alto, a city that claims to be liberal, hopelessly conservative members on our City Council voted last night to block rent control or rent caps from even being studied. What is the harm in studying it? Maybe they fear it won't actually lead to high crime, civic blight, plunging real estate prices, and biblical plagues, as alarmist property owners claimed last night. Maybe they fear it will actually help renters.

One thing was clear last night: a huge gulf separates councilmembers who are for renters from those who are there to serve property owners:

For renters: DuBois, Holman, Kou

For property owners: Filseth, Fine, Scharff, Tanaka, Wolbach

Don't forget that when you vote.


58 people like this
Posted by musical
a resident of Palo Verde
on Sep 11, 2018 at 4:46 am

I'm a bit puzzled why a council member must be recused if a landlord, but not if a tenant.
Isn't this equally a conflict of interest on either side, or am I missing something? Molly?


69 people like this
Posted by Watcher
a resident of another community
on Sep 11, 2018 at 6:12 am

Cory Wolbach needed to keep his pro-developer buddies on Council happy. He did by simply restating the renter protections that are already codified, but not what can be effective and substantive. As for his long winded rambling dialogue about working for a compromise, as you all witnessed; its his way or no way. That’s the build baby build model and when has he said no to an office project.

Adrian Fine comes through and through giving away the keys to Palo Alto to the developers eroding the fabric and soul of this community. Hey renters, old people, sick people, single family honeowners: you have been here too long time taking up space. The tradegy is the YIMBYs in their flawed ideology will be the cause for creating more suburbs as they cause for densification. People will move to the outskirts and will form new suburbs. Young families will always want that backyard and good schools.

Greg Tanaka tells the current renters that you aren’t diverse enough for his type of Palo Alto, you need to make way for those Stanford students graduating and tech workers that need the room.

Greg Scharff, mega commercial high density residential property owner, of course, would not want rent stability, just cause evictions and having to pay relocation costs to tenants.

Eric Filseth is showing what kind of Mayor he’d be. When he doesn’t like the colleagues’ comments, he’ll be disallowing dialogue on topic or not. More evident from Filseth is that title inflates his ego and the pro developer majority Council members has been feeding it big time.

As for the election, watch out for those who refuses to have a position, wants civility, to bring the two sides together and to find a compromise. Its an empty statement/promise.

What a pathetic bunch.


93 people like this
Posted by Professor
a resident of Greenmeadow
on Sep 11, 2018 at 7:37 am

Paul Krugman, nobel prize winner economist and famous liberal commentator at the New York Times put it best:

"The analysis of rent control is among the best-understood issues in all of economics, and -- among economists, anyway -- one of the least controversial. In 1992 a poll of the American Economic Association found 93 percent of its members agreeing that ''a ceiling on rents reduces the quality and quantity of housing.'' Almost every freshman-level textbook contains a case study on rent control, using its known adverse side effects to illustrate the principles of supply and demand. Sky-high rents on uncontrolled apartments, because desperate renters have nowhere to go -- and the absence of new apartment construction, despite those high rents, because landlords fear that controls will be extended? Predictable."

Read the whole thing here: Web Link

Krugman wrote this article in June 2000. Here we are 18 years later, in ahighly educated community discussing rent stabilization as if it were a compelling new idea. It is ironic the sames friends and neighbors that are horrified by the climate change denialists will turn around embrace rent stabilization in complete denial of sound evidence and economic theory.

Consider spending a weekend morning reviewing any number of online coursework on rent control and price theory.



22 people like this
Posted by R. Davis
a resident of Crescent Park
on Sep 11, 2018 at 7:46 am

QUOTE: What a pathetic bunch.

Based on the PA Weekly account, this council meeting was more along the lines of a poorly produced TV 'reality' show...with lousy actors & a lousy script.


45 people like this
Posted by Renter and Owner
a resident of South of Midtown
on Sep 11, 2018 at 8:03 am

The quickest path to reducing the number and quantity of rental housing is rent control.

As noted above, the best minds in the world have looked at this issue from a purely academic empirical approach. If you want to encourage more and better rental opportunities, you can not have rent control.

Developers will simply move to building condominiums, that is if the land is available.

Between Palo Alto's horrific processes imposed on developers of any kind, total lack of vision/leadership by the ARB, and this Council's willingness to cave to 4 rowdy complainers, we will continue to see high rents, worthless "pocket parks", architectural eyesores, and a continuous decline in the City's livability.

Remember this when we vote in November. The status quo is not helping make Palo Alto a better place to live.


37 people like this
Posted by Online Name
a resident of Embarcadero Oaks/Leland
on Sep 11, 2018 at 8:22 am

Online Name is a registered user.

"Council members Adrian Fine, Greg Scharff, Greg Tanaka and Cory Wolbach all voted against DuBois’ amendment to expand the range of renter-protection policies that will be studied, effectively killing it (Liz Kniss recused herself because her family has financial interest in a rental property)."

Doesn't Scharff also own rental properties and represent their owners in his legal practice?


1 person likes this
Posted by Anon
a resident of Another Palo Alto neighborhood
on Sep 11, 2018 at 8:30 am

Posted by Renter and Owner, a resident of South of Midtown

>> If you want to encourage more and better rental opportunities, you can not have rent control.

Somewhat true, but, I would like to hear if -any- of the options that might be explored might be beneficial.

>> this Council's willingness to cave to 4 rowdy complainers,

s/4 rowdy complainers/developers/

>> worthless "pocket parks",

Can you be more specific? Which features are you referring to? Are there any that you consider worthwhile?

>> Remember this when we vote in November. The status quo is not helping make Palo Alto a better place to live.

Well, at least we are agreed on something.


13 people like this
Posted by Thomas Paine
a resident of Green Acres
on Sep 11, 2018 at 8:32 am

The best way to help renters is via a subsidy based on income to be funded by a new Palo Alto City income tax. This way everyone in Palo Alto helps support the rental property pool. This is how to encourage development of rental properties, not by dictating how much a landlord can charge. Los Angeles has thousands of neglected apartment buildings because rent controlled landlords only perform required structural and safety maintenance. Peeling paint and overgrown yards have become the norm for many buildings.


11 people like this
Posted by Anon
a resident of Another Palo Alto neighborhood
on Sep 11, 2018 at 8:38 am

Posted by Professor, a resident of Greenmeadow

>> Paul Krugman, nobel prize winner economist and famous liberal commentator at the New York Times put it best:

>> "The analysis of rent control is among the best-understood issues in all of economics, and -- among economists, anyway -- one of the least controversial. In 1992

Professor-- clearly "classical" rent control doesn't have the desired effect. But, it seems possible that sometime since 1992 some system of incentives has been tried that actually works to keep working-class families from being forced out during the "boom" phase of "boom-and-bust" cycles? Maybe there is nothing that helps, but, perhaps we know of something now that we didn't know about in 1992.


27 people like this
Posted by Untruthful
a resident of Downtown North
on Sep 11, 2018 at 8:39 am

I was pleased to see four council members come back with a proposal after last years rent control debate failed. It was great they got Wolbach on board. But to then just add rent control and just cause evictions back in is trying to relocate the past. Shane on Holman and DuBois for failing to be able to accept a compromise, and trying to relitigate last years fight. Fine was spot on when he said this came out of nowhere without any public notice.


26 people like this
Posted by Council full of DINOs
a resident of Another Palo Alto neighborhood
on Sep 11, 2018 at 8:42 am

Hard to believe how so many of these DINOs (Democrats In Name Only) ever got local Democratic Party endorsements .... well probably not so hard after looking at who bankrolls most local elections.

By the logic of some of these DINOs, should we stop having good free public schools or nearby VA health services or great free public libraries or free parks b/c it might get residents "locked in" in our communities?

Kniss' recusal is puzzling as it doesn't seem like she recused herself in previous discussions (including emergency ordinance for relocation)


8 people like this
Posted by E P A
a resident of The Greenhouse
on Sep 11, 2018 at 8:44 am

Rent control has worked great for East Palo Alto all these years.


44 people like this
Posted by Private Parent
a resident of Fairmeadow
on Sep 11, 2018 at 8:53 am

Anon:

None of the options on the table help the situation for renters in general. The literature is vast and extensive on this point and possibly the least disputed finding in economics. All of these options make the situation really good for incumbent renters, and makes them stay in their units far longer than they otherwise would, reducing natural turnover and therefore available supply.

As said above, discounting these results is the same as climate-change denial. The evidence is that strong.

"Rent Stabilization" is a horrible euphemism. There is no attempt to "stabilize" rents. The entire goal is to "cap' them. You can bet that if the bottom fell out of the rental market, no one would be lining up to subsidize the landlords (as they shouldn't).

I'm in favor of renter protections such as requiring a reasonably-long notice; preventing evictions during the school year, and similar things. But allowing only "just cause" just means that a landlord has to be even more picky about those they will rent to because you can't get them out if your circumstances change.

This is a bad idea all around, and it is magical thinking to believe that rent control will help solve the housing crisis.


13 people like this
Posted by Me 2
a resident of Old Palo Alto
on Sep 11, 2018 at 9:07 am

"Professor-- clearly "classical" rent control doesn't have the desired effect. But, it seems possible that sometime since 1992 some system of incentives has been tried that actually works to keep working-class families from being forced out during the "boom" phase of "boom-and-bust" cycles? "

These are all band-aids on what is the core of the problem - not enough supply. I find it interesting that many of the residentialists are now shocked - shocked! - that the result of their actions has now led to higher housing and rental costs.

Two wrongs don't make a right. Purposefully hindering supply and layering on rent "stabilization" on top of it doesn't work.

It just leads to the hollowing out of the middle class - just like San Francisco. Great. The legacy of long-time residents of Palo Alto will be just that. Sad. Thanks for nothing.


35 people like this
Posted by Online Name
a resident of Embarcadero Oaks/Leland
on Sep 11, 2018 at 9:16 am

Online Name is a registered user.

The following exchange sums up the ideological split perfectly. Some are for EXISTING residents and taxpayers; some aren't.

It would seem the CC should be serving US first instead of seeing that we're over-run with Apple Spaceship-sized developments at Stanford, etc etc. Pay attention and vote.

"The discussion became particularly testy after Holman called existing tenants such as those in attendance "some of the most valuable tenants and residents we'll ever have."

"Because they've been invested in this community by way of their residency, by way of their occupations, by way of their volunteerism," Holman said.

Fine and Scharff chafed at this comment, with Scharff likening Holman's implied support of existing residents over future ones to the federal restrictions on immigration.

"This reminds me of our immigration debate," Scharff said. "I doubt any of you would stand up and say publicly, 'We don't want immigrants coming to our city.'"

Holman said she found this comparison "exceedingly, exceedingly insulting."


27 people like this
Posted by @Online Name
a resident of Another Palo Alto neighborhood
on Sep 11, 2018 at 9:22 am

"This reminds me of our immigration debate," Scharff said.

It's also a dangerous analogy for him to use; after all wouldn't his positions make him a strong advocate of no cause deportation?


10 people like this
Posted by An RV Dweller On ECR
a resident of Stanford
on Sep 11, 2018 at 9:55 am

I am fortunate enough to be covered under rent control in Palo Alto. My landlord currently charges me $650.00 per month to live in his older RV which is periodically parked along El Camino Real and other streets in Palo Alto.

It is an informal agreement as he retains possession of the ignition key while I have a key to the living area. In the event I receive a parking citation, I simply contact him on my cell phone and he then moves the vehicle to another location in the city.

To date, I have lived in many different PA neighborhoods, some more convenient for shopping and 'personal necessities' than others. The only grounds for eviction we have is not to disturb residents in their respective PA neighborhoods by littering and/or creating unnecessary noise.

It works out pretty well except for the lack of indoor plumbing and waste options.
The RV also has a small AC generator but I have been advised not to run it when residents are at home.


29 people like this
Posted by Sally
a resident of Downtown North
on Sep 11, 2018 at 10:41 am

Despite the fact that I feel that Mr. Tanaka's presentation style can be chaffing (imho), I also feel he is thoughtful, refreshingly frank in sharing his thought processes, and committed to procedurally correct and transparent policy formation.

We are blessed to have him on a council that can all too often feel like any other political body. I feel Greg is a great complement to the other more typical personalities on a city council... I hope we are smart enough as a city to keep him there, unusual politician though he is.


29 people like this
Posted by BlackbeardsMom
a resident of Midtown
on Sep 11, 2018 at 11:04 am

BlackbeardsMom is a registered user.

@PrivateParent...FINALLY! Someone else who gets it. Rent control is a terrible way to settle this mess. Either current tenants NEVER move out, or more likely as is the case in many SF neighborhoods, the owners simply sell their buildings to relatives to move everyone out, then re-rent at higher rates. When they want to raise the rents the cycle begins again. Renter PROTECTION is what's needed, not control


23 people like this
Posted by Jim
a resident of Community Center
on Sep 11, 2018 at 11:23 am

Rent control simply means forcing landowners to subsidize renters. This often means subsidizing middle to high income people that are renting as well.

Why place the burden directly on landlords?

Instead, why not provide income supplements to low income people from community taxes so that low income people can afford market rents? Rent control asks the landlord to provide all the subsidies. Maybe everyone in the community should be equally taxed to pay for low income people.

Are you willing to pitch in and help low income folks?


23 people like this
Posted by Diversity
a resident of Southgate
on Sep 11, 2018 at 11:26 am

The"diversity" promoted by Scharff and Tanaka is the Asian millionaires and billionaires who dominate the real estate market. They were out in full force at the Council, landlords opposing any controls.

Aside from the institutional rental organizations, the overwhelming number of opponents were not techies, but rather foreign investors.


17 people like this
Posted by Adam Smith
a resident of Old Palo Alto
on Sep 11, 2018 at 11:49 am

If you can't afford to live in Palo Alto, move to Stockton and let someone else who can afford it move into your unit


11 people like this
Posted by Anon
a resident of Another Palo Alto neighborhood
on Sep 11, 2018 at 12:07 pm

Posted by Adam Smith, a resident of Old Palo Alto

>> If you can't afford to live in Palo Alto, move to Stockton and let someone else who can afford it move into your unit

Because the invisible hand never makes long-term mistakes, right? But, what about a division of labor in which "every workman" has to live to Stockton? What about monopolies and price-fixing business interests engaged in "conspiracy against the public or in some other contrivance to raise prices"?

BTW, I'm not arguing in favor of old-fashioned "rent controls". But, I don't see why we don't build new office space in Stockton, which needs a boost to its local economy, instead of here.


30 people like this
Posted by execfolkie
a resident of Midtown
on Sep 11, 2018 at 12:16 pm

execfolkie is a registered user.

I moved to Palo Alto 25 years ago this summer. I was happy to do so for so many reasons. My son went through all of PA's great public schools and my wife could bike to Stanford for work. I was very proud of living there for a long time.

I now live in Mt. View and very proud of that. Palo Alto has abandoned all of its progressive political heritage; in fact, it used to be a community of very progressive thinkers and leaders. It seems to be losing its edge in Silicon Valley's leadership circles. Especially among elected officials.

Rent control is a great equalizer in this local Google/Facebook economy. Developers still make good money but for some reason want to shut out renters from living here. What are they afraid of or are they just too greedy? I am actually not sure.

I still hope for the best when it comes to "allowing" people and families to live in this beautiful place by the Bay.


12 people like this
Posted by Aletheia
a resident of Green Acres
on Sep 11, 2018 at 12:28 pm

Aletheia is a registered user.

Adults in the room: Scharf, Fine, Tanaka, Wolbach.


34 people like this
Posted by Professor
a resident of Greenmeadow
on Sep 11, 2018 at 12:48 pm

I am truly empathetic to the plight of renters that are getting out-priced. Critical members of our community including teachers, fire fighters and police cannot afford to live here.

Unfortunately, rent stabilization (price controls really) only will make the problem worse.

The underlying problem is complex with the core issue entirely beyond local control: wealth inequality at a global scale driven by cheap money for decades and eventually trillions of printed money since 2009. This problem is far bigger than Palo Alto. It would be like Palo Altans trying to micromanage the weather - not possible and a waste of resources.

Paradoxically to the rent-control advocates, the best solution is to become more landlord friendly in Palo Alto. Why? Because landlords supply the market. In a market friendly to landlords, they will increase the supply thereby reducing rental rates and market friction.

By increasing regulation and imposing transaction costs (relocation benefits paid by landlords), the market will stabilize at a lower supply and higher rents. *Exactly* the opposite of its intended effect. This is Econ 101 microeconomics, supply and demand. Please google it and learn if you disagree with the conclusions.







23 people like this
Posted by Barron Park dad
a resident of Barron Park
on Sep 11, 2018 at 1:17 pm

Can someone refute Paul Krugman's analysis on the evils of rent control? Seems to me that Greg Tanaka is the only one who read it.

Web Link

To offset overly harsh market forces, I'm also in favor of renter protections such as requiring a reasonably-long notice; preventing evictions during the school year, and similar things.


11 people like this
Posted by Bye bye
a resident of Downtown North
on Sep 11, 2018 at 1:29 pm

So glad that Karen Holman will be off the council this year. She Is so out to of touch and clueless about reality. But not surprising given her support for the historic ordinance and the bike bridge.


2 people like this
Posted by Nope
a resident of College Terrace
on Sep 11, 2018 at 1:53 pm

Look I've been homeless for about 5 years already because of rent increase and I've been a PA resident for almost 25 years. They should be giving priority to those who have been here longer and cap the rent increase. Those who are new here should pay a tax or even start raising the rent for them. Apart of that money should go into the city and fix what ever the hell they need to fix like the roads. Let's start there. I'm not planning on being homeless for the rest of my life


25 people like this
Posted by former renter
a resident of Another Palo Alto neighborhood
on Sep 11, 2018 at 1:56 pm

Karen Holman

"A lot has happened. Notwithstanding the President Hotel. Climate has changed, the culture has changed, the circumstances have changed, and that's why we need to be even more inclusive of what the discussion is," Holman said, adding that the discussion is even more appropriate now than it was a year ago.

Thank you for this comment, lack of leadership on the renter protections issue is actually very important to those of us who own a home here. The short sightedness by Scharff, Fine, Tanaka, and Wolbach is that they think that people will continue to pay premium rents for decreasing quality of life.

We now own a home in Palo Alto but were previously longtime renters here.

We paid increasing levels of rent for several years, to stay and "invest" in the community. Our desire to stay in Palo Alto and ability to eventually purchase a home here spared us from being outplaced, but having been a renter longer than an owner in Palo Alto, I can instinctively say that we would likely not have "invested" here under current conditions.

Current renters have paid premium rents year after year obviously because on balance the calculation worked out, I would say most likely because of quality of life. My calculation for our family (if we still rented) is that with increased traffic, threats to the community becoming even more burdened with costs, many of the things we valued have eroded. I was an enthusiastic renter, and this would not be the case anymore.

In the shuffle, we are definitely losing the people who have made or are making sacrifices to pay premium rents and I don't think this is something to joke about.

Renter protections would have made me more inclined to keep investing in Palo Alto.

No idea what the numbers will look like going forward, but unless quality of life is preserved and costs are kept down for current residents, I would not be so quick to boot current renters or treat this issue as if the party of paying dearly to live here can go on forever.


9 people like this
Posted by Renters Unite!
a resident of Evergreen Park
on Sep 11, 2018 at 2:00 pm

>> If you can't afford to live in Palo Alto, move to Stockton and let someone else who can afford it move into your unit.

Too far to commute. Stockton and Tracy are OK if one works in the surrounding areas.

Intending to remain in Palo Alto where I am currently employed (Stanford).

The days of greedy developers and landlords is gradually coming to an end.

If they want to gouge renters even further, these modern-day robber barons will now have to pay through the nose in order to compensate their displaced tenants.

Lower the rents and then we'll talk. Until then, be prepared to cough up the CASH.




33 people like this
Posted by Margaret Heath
a resident of Evergreen Park
on Sep 11, 2018 at 2:02 pm

Margaret Heath is a registered user.

"The only council member who opposed any new exploration of rent-stabilization measures was Tanaka, who argued that adopting policies that support existing tenants would necessarily lock everyone else out of the city."

Council member Wolbach refused to vote for the study if it included any mention of rent stabilization options. This was why he voted to opposed the study last year and why he would do so again unless studying rent stabilization was excluded. He spent a fair amount of time explaining his thinking.

Council member Fine was vociferous in his argument against allowing any mention of rent stabilization options.

Council member Scharff was similarly vociferous in his arguments about why any study of renter protections must omit any mention of rent stabilization.


7 people like this
Posted by Chris Gaither
a resident of Mayfield
on Sep 11, 2018 at 2:06 pm

The simplest solution, do away with rentals, and let people own wherever they live. In Singapore, and other countries, people are allowed to purchase their apartments, and convert or remodel the units, or add units to one another. The government in those countries support such land use, as there simply is not enough land to build new homes, etc. Also, we should be promoting housing ownership whether people are low-income, moderate income, or high income. For people to be "stuck" in rental situations all of their lives, and for landlords and property owners to make a business out of renting spaces for people to live, is just not essential. Let property owners who accumulate residential properties find another way to make a living with their properties. I firmly believe, no one should own multiple residential properties, until or unless everyone owns something to live in for their entire lives. No one who wants to be housed, should be homeless. Of course, there are folks who are nomadic and don't want ties to anyone. As a result, there will always be a minority of people who simply chose not to systematize their living conditions.


35 people like this
Posted by Sheri
a resident of Midtown
on Sep 11, 2018 at 2:47 pm

Sheri is a registered user.

How many times did DuBois have to say they were not enacting anything, but merely agreeing to study all options? Why such resistance to even looking at everything that could POSSIBLY be done?


31 people like this
Posted by Annette
a resident of College Terrace
on Sep 11, 2018 at 2:54 pm

Annette is a registered user.

How is it that this conversation excludes mention of the fact that the main reason we are in this mess is that we gorged ourselves on office development despite knowing that we could not house even a fraction of those who understandably desire to live near where they work? Now some on CC are offering solutions and they are reviled as the bad guys? That's a little like shooting the messenger.

I think Pat Burt is right in saying that "the President Hotel mass evictions have brought attention to the broader issues effecting the over 40% of Palo Alto residents who are renters." Had this not happened we might still be ignoring reality. We earned this wake up call. So let's wake up!

For starters, can we agree that last night's CC meeting stands as an embarrassment? We can and should do better.

I am not a proponent of rent control but we've "officed" ourselves into an ugly corner and don't have much choice but to both embrace some form of protections and add some housing inventory - while simultaneously figuring out grade separation and traffic circulation. I don't see any way out of this mess w/o each side compromising at least a little.


32 people like this
Posted by @Annette
a resident of Fairmeadow
on Sep 11, 2018 at 3:27 pm

@Annette is a registered user.

"[we] don't have much choice but to both embrace some form of protections and add some
housing inventory - while simultaneously figuring out grade separation and traffic circulation."

No less important, at the same time we should strive to reduce office space by making the area less hospitable to large corporations like Palantir, which are consuming our precious downtown retail and residential service space.

We cannot just add housing without considering the services that those residents will need. And since we have grossly over-officed, we just need policies in place to correct that. It's not hard. We just need the will.


23 people like this
Posted by Curmudgeon
a resident of Downtown North
on Sep 11, 2018 at 3:28 pm

"Rhovy Lyn Antonio, who represented the California Apartment Association, urged the council to formulate strategies that would not harm housing providers. "It's hard to protect renters in Palo Alto when you're harming people who are providing housing to them," Antonio said."

Yup. Harming them alright. They won't be able to afford that new Bentley or Lamborghini if they can't raise rents at will. Sad.


15 people like this
Posted by Dubios is the worst
a resident of Southgate
on Sep 11, 2018 at 3:28 pm

Dubois's comments and actions make him unqualified for the position he sits in and is seeking! Four councillors brought a memo forward, and then Dubois makes a motion which one of the authors (Wolbach) was shocked by. IE Dubois immediately threw his co-author under the bus. Imagine working with that guy!

Good job by Scharff and Fine for calling Dubiois out for his nefarious behavior. NIMBYS have no honor.


25 people like this
Posted by Online Name
a resident of Embarcadero Oaks/Leland
on Sep 11, 2018 at 3:35 pm

Online Name is a registered user.

""Rhovy Lyn Antonio, who represented the California Apartment Association, urged the council to formulate strategies that would not harm housing providers. "It's hard to protect renters in Palo Alto when you're harming people who are providing housing to them," Antonio said."

Yup. Harming them alright. They won't be able to afford that new Bentley or Lamborghini if they can't raise rents at will. Sad."

And CC candidate Cormack says a lower office cap "limits our degrees of freedom."


34 people like this
Posted by Pat Burt
a resident of Community Center
on Sep 11, 2018 at 3:38 pm

Pat Burt is a registered user.

Tom DuBois noted that approximately 60% of Santa Clara County residents are already protected by caps on rental rate increases and by Just Cause Eviction requirements. San Jose allows higher annual increases (5%) than does Mountain View. At the same time, those cities are regional leaders in the amounts of new rental housing being built. Go figure.
It's not clear why Wolbach was so adamantly opposed to even considering alternatives that seem to work in neighboring cities.
These are important issues effecting the diversity and sustainability of our community. They should involve good analysis and thoughtful discussions of trade-offs and competing value sets. Unfortunately, it looks like that discussion has been limited for the time being.


23 people like this
Posted by @Pat Burt
a resident of Duveneck/St. Francis
on Sep 11, 2018 at 3:44 pm

San Jose and Mountain View are not building more housing _because_ they have rent control - they're building more housing because they've _chosen to build more housing_. Unlike you who as mayor said we have too many jobs and did absolutely nothing to address the housing crisis. Building housing is a simple choice, and people like you and Tom DuBois are simply against new housing, so stop trying to pose as anything else.


8 people like this
Posted by former renter
a resident of Another Palo Alto neighborhood
on Sep 11, 2018 at 3:59 pm

Pat Burt

"These are important issues effecting the diversity and sustainability of our community. They should involve good analysis and thoughtful discussions of trade-offs and competing value sets. Unfortunately, it looks like that discussion has been limited for the time being."

Renter protections looks like a good issue to have a ballot measure for.

In my view, stronger renter protections can serve home owners the most.

Best way to get a debate seems to take it to the voters.


12 people like this
Posted by Annette
a resident of College Terrace
on Sep 11, 2018 at 4:35 pm

Annette is a registered user.

Shocked? Nefarious? NIMBYs? No honor?

Aw, c'mon. There were enough theatrics on the dais last night for a three act play. It was vintage Cirque de PA. Small wonder the meetings run long and late.



9 people like this
Posted by former renter
a resident of Another Palo Alto neighborhood
on Sep 11, 2018 at 4:37 pm

This is an example of how the economics sometimes works for renters who are "invested" in the community.

We paid premium rents in Palo Alto for many years, and I would also contribute annually to PIE (the foundation to support PAUSD school programs). Usually I contributed above the suggested amount per student.

If I was still paying today's rents, as mentioned I may have already been priced out of Palo Alto, but had we remained renters, increasing rents would have had an impact on how much we donated to the schools.

I would estimate that there is a negative correlation between increasing rents and contributions to PIE and this loss may have already happened.

The counter argument to this is that rich (er) people will rent the vacant rentals and have more money to donate to PIE. That is something worth studying.

Have average size contributions to PIE increased as turnover has occurred the past recent years?

My estimate is that people will not rent the homes that we previously rented over the years at non-stop increasing prices because there is a place where the trade offs do not make sense.

Council does not seem to worry about leaving Palo Alto with too much office space or too many over-priced rentals. This all should at least be studied further.


27 people like this
Posted by Bait & Switch Wolbach
a resident of Downtown North
on Sep 11, 2018 at 4:51 pm

It was NEVER about ensuring keeping the community of citizens who live in Palo Alto, renter or homeowner. It is about keeping up the facade. The original renter protection colleague's memo had some effective means to help keep the current diversity of residents, but Wolbach and his gang made it an ultimatum, similar to what Scharff did with the emergency ordinance for eviction relocation.

These people play with people's lives, and then goes out and pats themselves themselves and thinks he made a compromise. Essentially, Wolbach just restated what exists now in the current renter protection ordinance. And, the tenants continue without any stability.

No, Wolbach sold out the tenant residents for your cronies' and developers' votes. Vote and vote him out.

Post from Cory Wolbach's Facebook page:

This is a big deal. Last night, a super-majority of the Palo Alto City Council voted to support a memo I co-authored to strengthen renter protections. I have long supported a 3-legged-stool approach to the housing crisis: (1) Overall supply, (2) affordable units, and (3) renter protections. Each leg of the stool has a broad range of policy options to pick from. Each has been an uphill political battle against entrenched opposition. I'm proud of our work to change the discourse and policies to support the first two, but now it is past time to protect renters.

After a failed attempt by others last fall taking a different approach, and my own failed attempt at the start of this year, I met with advocates and experts, and reached out to my colleagues to craft a compromise which we thought the community could rally behind.

We drafted our memo, introduced it this summer, and last night almost the entire Council supported it.

We still need to work hard on each leg of the stool: address the underlying supply and demand imbalance, build as many affordable units as possible, and protect renters. Our community is being torn apart by the exodus of people fleeing Palo Alto and the region. We have to take our heads out of the sand.

Compromise is tough. It means nobody gets everything we want. But maybe we can all get something we can live with. Implementing a good policy is better than just talking about a perfect one.


2 people like this
Posted by peppered
a resident of Another Palo Alto neighborhood
on Sep 11, 2018 at 4:58 pm

peppered is a registered user.

Rent control is wonderful when staying in an apartment at less than half the market rate. Not so much if you're a property owner living off the proceeds. The free market is a wondrous thing.


38 people like this
Posted by former renter
a resident of Another Palo Alto neighborhood
on Sep 11, 2018 at 5:03 pm

Bait and Switch Wolbach,

Wolbach should have never been trusted on the basis of his 3 legged stool "for the housing crisis"

Wolbach..."I co-authored to strengthen renter protections. I have long supported a 3-legged-stool approach to the housing crisis: (1) Overall supply, (2) affordable units, and (3) renter protections."

Wolbach mixes "housing crisis" (a regional catastrophe that Palo Alto Council cannot keep up with) with housing crisis related to the plight of current residents and economics for property owners in Palo Alto.

Failure to understand the difference is not very good.

BTW "overall supply" will NOT bring housing prices down in Palo Alto, if this is not the case of stupidity not sure what is.






7 people like this
Posted by common sense
a resident of Midtown
on Sep 11, 2018 at 5:29 pm

Pat Burt -

The rental housing built in the last few years in Mountain View and San Jose is exempt from rent control; the Costa Hawkins Rental Act of 1995 prevents cities from establishing rent control—or capping rent—on units constructed after February 1995. It also exempts single-family homes and condos from rent control restrictions.

A wise and smart person like yourself should compare the market value of a multi residential building built before 1995 and after 1995, and you can tell us the price difference.

The city government has been trying to encourage people to add Accessory Dwelling Units (ADU) to their property to add housing units.

The state has a ballot measure to repeal Costa Hawkins.

If Costa Hawkins is repealed, all those people who are building ADUs, may end up regretting having a rental unit. And cities which impose new rental restrictions will cause the market value of all the newly constructed multiresidential properties to drop, which means lower assessed values, and less funding for schools and government. It will also make residential rental project a much less attractive investment.

There is also a split roll initiative, where commercial properties would be reassessed at least once every three year, proposed for the 2020 ballot. Cities will give a city more incentive to build commercial projects rather residential.

If the city government and it's minions were really serious about housing, they would

1) end all incentives to build commercial (all the densitiy bonuses for this and that, all the "buy outs" for parking, etc).

2) Rezone massive amounts of downtown, El Camino, Stanford Industrial Park and Stanford Shopping center for residential only.


38 people like this
Posted by Another Giveaway
a resident of Another Palo Alto neighborhood
on Sep 11, 2018 at 5:31 pm

Wolbach said:

"I have long supported a 3-legged-stool approach to the housing crisis: (1) Overall supply, (2) affordable units, and (3) renter protections".

The first two legs on Cory's stool are made out steel and the third leg is made of paper mache. Cory is allied with the faction of the Democratic Party machine that has an unsavory financial relationship with developers and commercial property owners.


7 people like this
Posted by Bye bye
a resident of Downtown North
on Sep 11, 2018 at 6:01 pm

Pat Burt— former council member and mayor- did nothing during his tenure to address this meter when he was in office. Now he is chiming in with his opinions about what should and should not be done. IMHO, pat Burt was Karen Holman before Karen Holman ( see my comment above about Karen)


15 people like this
Posted by Time for a Change
a resident of Evergreen Park
on Sep 11, 2018 at 6:34 pm

> It was NEVER about ensuring keeping the community of citizens who live in Palo Alto, renter or homeowner. It is about keeping up the facade.

What is the impeachment process for the entire PACC (including mayor & vice-mayor)?

Can we start anew? What is there to lose?



4 people like this
Posted by former renter
a resident of Another Palo Alto neighborhood
on Sep 11, 2018 at 6:40 pm


bye bye,


if your idea of bye bye is hello hello to 3 legged stool, no wonder there is circus drama at council


1 person likes this
Posted by John Sith
a resident of Crescent Park
on Sep 11, 2018 at 9:34 pm

Interesting debate.

For those seeking removal of rent control the argument goes. . . rent control limits development. Therefore, remove rent control and developers will start building. New supply gets delivered - the area houses more people at market rates.

But what about the NIMBYs.

If they are successful in blocking new development, removing rent control does not result in new development.

The area becomes unaffordable for all but the already wealthy. Tech companies subsidize their workers housing. The middle class saves very little to nothing, creates no families, doesn't buy homes, moves elsewhere. The long time resident workers are replaced.

Or, maybe they are unsuccessful in blocking new development and the area sees lots of new supply.

What about the infrastructure? It becomes even more crowded. More office buildings are constructed. Where do the workers live?

Google starts building housing for its workers on its own land. New houses are built with guest houses for the out of town contract workers, an Airbnb at 40% of median income for a months stay.

A homeowner asks its guest house tenant to tend to the backyard.

Sounds a lot like wealthy land barons of the 1800s.

The problem is inequality. The only reasons anyone is here is to make a living and raise a family.

A whole generation has already decided to postpone raising a family in the area because of cost.

Keep make it more expensive.







12 people like this
Posted by Me 2
a resident of Old Palo Alto
on Sep 11, 2018 at 9:41 pm

"How is it that this conversation excludes mention of the fact that the main reason we are in this mess is that we gorged ourselves on office development despite knowing that we could not house even a fraction of those who understandably desire to live near where they work?"

Really Annette? Do you really think that an office in Palo Alto is different from an office in Mountain View? Or Sunnyvale? Or San Bruno?

Capping office development in Palo Alto will do nothing. Economic growth does not honor city boundaries. For the years I've lived in Palo Alto, I've never *worked* in Palo Alto.

The bottom line is that this region, which includes Palo Alto, has not kept up growth in housing supply. And for all the bleating about running out of space, as I've said before, I'm not sure how you can keep claiming that with a straight face after driving on 280.

Rent control does nothing for supply. It just gives a lottery ticket to people who have lived in a place longer. Like Prop 13.


13 people like this
Posted by Geez
a resident of East Palo Alto
on Sep 12, 2018 at 5:35 am

@Me too, [portion removed]"Rent control does nothing for supply. It just gives a lottery ticket to people who have lived in a place longer. Like Prop 13."

Prop 13 also applies to the property owner who is renting out their property and have held on to it forever reaping the low property tax base but continues to increase their rent to market rates with every opportunity.

All commercial properties have the umbrella of Prop 13 to carry on their business of charging top rents and paying little to property taxes, YET gets to get residents to share in paying for Palo Alto's infrastructure upgrades and repairs to support THEIR employees when this is an operational expense for the business.

Palo Alto does not have to follow in Mountain View nor other growth cities footsteps. Let them lead... we follow to find out the pros and cons of their actions.

I'm all for a moratorium of all building in Palo Alto until we have resolved traffic congestion issues, parking issues, community serving retail, keeping top quality schools, student safety and social well being, 4mil acres per 1000 residents, underground Caltrain and for @Me Too who lives in Palo Alto but for years have not worked in Palo Alto to find a job in Palo Alto then. You live in Palo Alto, work here then. @Me Too, you will find as you already know, you invest and live in one place and that is called stability. You travel to where you have a job, as obviously you do.

Oh hey @Me Too, I hope you ride you bike to work wherever it is you work.






8 people like this
Posted by Shenandoah
a resident of Crescent Park
on Sep 12, 2018 at 6:56 am

The pasz contingent has opposed housing for years, now they claim that they care about renters. [Portion removed.]


5 people like this
Posted by He will run again
a resident of Another Palo Alto neighborhood
on Sep 12, 2018 at 7:09 am

Pat Burt is probably getting ready for another run for council in 2020. He is setting the stage to,appear as the pro-pass, pro-renter/resident candidate. [Portion removed.]


2 people like this
Posted by What salary????
a resident of Evergreen Park
on Sep 12, 2018 at 7:22 am

City Council members do NOTNnhX get a salary.
They get a small stipend to cover misc. costs.


2 people like this
Posted by Me 2
a resident of Old Palo Alto
on Sep 12, 2018 at 8:14 am

[Post removed.]


3 people like this
Posted by The Landlord
a resident of Charleston Meadows
on Sep 12, 2018 at 9:25 am

>>> "Prop 13 also applies to the property owner who is renting out their property and have held on to it forever reaping the low property tax base but continues to increase their rent to market rates with every opportunity."


This is the key to further wealth. In another incarnation, it is often referred to as the 'Phil Knight Business Model'.

By reducing the costs of production labor and materials while at the same time, increasing the retail prices, one can make an enormous sum of money.

In the case of Palo Alto rental properties:

Prop 13 (1978) = the original buy-in/investment advantage + real property was cheaper back then.

Current and increasing PA rental rates = the big pay-off.

You can't blame the landlord if you happened to be born too late.




10 people like this
Posted by Pat Burt
a resident of Community Center
on Sep 12, 2018 at 9:40 am

Pat Burt is a registered user.

I hope the discussion can stick to debating the issues and avoid name calling or trumped up conspiracies.
For the record, anyone who knows me well can tell you that I don't readily trot at the beckoning of others. Also, I have never been affiliated with PASZ and they have not supported me. While I appreciate the work they did on the office cap initiative and their support of Buena Vista, I have generally been more open to additional housing that them.
Now, hopefully back to debating the merits of the issues...


4 people like this
Posted by Anon
a resident of Another Palo Alto neighborhood
on Sep 12, 2018 at 9:42 am

Posted by Me 2, a resident of Old Palo Alto

>> Yep. Prop 13 sucks.

We agree. Prop 13 is considered by some economists to be the root cause of California's high housing costs. e.g. UC Riverside economist Chris Thornburg:

" "It’s financially bad for cities to want residential units," he says, "and as a result of that, every city is biased against wanting housing."

" Thornberg says Prop 13 has led cities to prefer commercial and industrial developments like offices and factories."

Web Link

Not so easy to get rid of Prop 13, though. Just repealing it suddenly without doing anything else would probably force a lot of us out of our houses.


41 people like this
Posted by Train Fan
a resident of another community
on Sep 12, 2018 at 10:28 am

'UC Riverside economist Chris Thornburg:
"It’s financially bad for cities to want residential units," he says, "and as a result of that, every city is biased against wanting housing."'

IF this statement is an accurate representation of Mr. Thornburg and/or city governments, then both are completely ignorant; that's not an insult, that's a fact.

For the past ~40 years, post-Prop13 revenue from California property taxes has increased on *average* by ~7.3% PER YEAR. That is a greater growth rate than inflation, and outpaces the State's economic growth during the same period.

The narrative that Prop 13 has starved California's government agencies of revenue is a tremendous lie foisted on Californians by pro-tax leftists, politicians and media, in the hope of convincing you to allow even MORE confiscation of your work and property.


7 people like this
Posted by michelle kraus
a resident of Downtown North
on Sep 12, 2018 at 10:54 am

The City of Menlo Park is not affraid of their shadow. They are considering renter relocation ordinance with a means test at 200% of the average median income. Wake up Council Members and the Daily Post.

"LIGIBLE TENANT means any tenant(s) residing in a rental unit in the City for twelve (12) months or more under a valid rental agreement whose annual household income, as adjusted for household size, does not exceed two-hundred percent (200%) of the area median household income for San Mateo County according to the United States Department of Housing and Urban Development, as may be adjusted from time to time."


25 people like this
Posted by Pat Burt
a resident of Community Center
on Sep 12, 2018 at 10:59 am

Pat Burt is a registered user.

Over the last dozen years our city staff or consultants have done three studies to try to determine the relative city income and expenses associated with new housing compared to new commercial development. The most recent was part of our new Comprehensive Plan environmental analysis. In each case the results were that each type of development had similar net city government financial impacts.
These conclusions are contrary to conventional wisdom and claims, and the assumptions being made by many cities that commercial development is more favorable fiscally. There are some important caveats. Not all commercial development has equal impacts. Hotels generate the highest commercial revenue for cities and have comparatively low impacts. Also, Basic Aid school districts, like PAUSD, derive most of their revenue from local property taxes and therefore benefit more from commercial than residential development. There are other complexities to the analysis as well.
This is an important issue which has not had adequate analysis regionally. Instead, many big decisions, impacting the sustainability of the region, are being made on hearsay and not well founded assumptions.


1 person likes this
Posted by Tell the truth
a resident of Another Palo Alto neighborhood
on Sep 12, 2018 at 11:43 am

[Post removed.]


11 people like this
Posted by Train Fan
a resident of another community
on Sep 12, 2018 at 12:11 pm

Pat Burt wrote:
"many big decisions, impacting the sustainability of the region, are being made on hearsay and not well founded assumptions."

Amen! While more broadly scoped, this is effectively similar to my point.

People *assume* prop 13 starves governments of revenue: not true.

People *assume* that commercial space generates more revenue for government: debatable, and the devil is in the details.

IMHO, in a nutshell...
Regionally, we need more housing, and we need denser housing.
Regionally, we need more public transportation.

It's really that simple.


27 people like this
Posted by Tom DuBois
a resident of Midtown
on Sep 12, 2018 at 12:45 pm

Tom DuBois is a registered user.

Monday evening was a frustrating discussion. Some have called into question my integrity but if you listened or watched the meeting, I made what occurred very clear.

When Councilmember Wolbach signed on to the colleagues memo, he and I discussed that council discussion should consider the full range of renter protections available in California including a discussion about just cause evictions and yes, rent stabilization. He agreed and suggested we remove mentioning those items in the memo explicitly in order to get Council support, but that they would be included.

After the memo was submitted, Councilmember Wolbach spoke publicly multiple times saying the memo excluded just cause eviction and rent control, contrary to our prior discussion. So Monday, I felt it was necessary to be clear with my colleagues and the citizens on exactly what would be discussed and I added language making the topics explicit. This has been painted as some form of betrayal but the exact opposite is true - I and the other authors of the memo were betrayed. You can watch the video and my statements and questions to Councilmember Wolbach clarifying that we had in fact agreed to include all topics but he didn't want to have transparent language about it.

The motion I made is below. I've been following what other bay area cities are doing and my position is open as to what set of protections would work well for both renters and property owners - I believe some protections would help but deeper analysis and discussion must occur.

I do believe we have a moral obligation to at least be able to discuss the spectrum of options. Council members Kou, Holman and Filseth agreed, with Eric changing his mind on the topic from last year and voting for it.

Some commenters imply that those voting for housing and for renters are somehow against them. It's a twisted world. My voting record on housing is clear (I've voted for nearly every housing proposal to come to council) and I stand by it. I do what I say. I've never uttered the worlds "while I am for this I'm going to vote against it". Yesterday, one council member apologized to me privately for some of his comments Monday night and I accepted his apology. Personal integrity on council is important. And I believe it is critical that we, as council members, represent ALL residents of Palo Alto, including renters.

My Motion from Monday

Council refer this memo to the Policy and Services Committee for review. The review should include at least the following:

i. Review of our existing renter protection ordinance and comparable ordinances in Bay Area.

ii. Evaluate reasonable relocation assistance to be provided for tenants of properties with 5 or more units displaced due to change of use, sizable rental increases or eviction without just cause, while protecting the fair rights of property owners.

iii. Strengthened enforcement measures to ensure compliance with and penalties for violations of Palo Alto’s existing requirement to offer an annual lease to tenants.

iv. Consider other updates to our existing renter protections and mediation program as needed to continue a healthy and diverse community.

v. Discuss the full range of renter protections. Discussion topics to include just cause evictions and rent stabilization among other protections.




10 people like this
Posted by Tell the truth
a resident of Another Palo Alto neighborhood
on Sep 12, 2018 at 12:56 pm

Tom Dubois has constantly sided with pasz in being against new housing. Now he claims he was betrayed. Suck it up, Tom. We need high density, tall housing in order to begin to address the lack of housing in the city. In the almost 4 years on the council, you have been against new housing marching in lock step with Holman, filseth and later Kuo- to the tune of the pasz bear.


25 people like this
Posted by Online Name
a resident of Embarcadero Oaks/Leland
on Sep 12, 2018 at 1:06 pm

Online Name is a registered user.

Thank you, Tom Dubois. And thank you for acknowledging the truth that we do in fact have real traffic problems, that office growth needs to be capped so it doesn't keep distorting the jobs/housing imbalance and keep pushing up prices and for looking out for the renters.


4 people like this
Posted by former renter
a resident of Another Palo Alto neighborhood
on Sep 12, 2018 at 1:23 pm

Pat Burt

"Also, Basic Aid school districts, like PAUSD, derive most of their revenue from local property taxes and therefore benefit more from commercial than residential development."

Your caveat does not make any sense

if schools derive most of their revenue from property taxes how does "commercial development help"?

The commercial development fees have been debunked - they are not enough to cover for the costs that commercial development imposes

Were you trying to say the opposite?

New question: How does rental housing development help City coffers? Those who want density don't say what the costs are, and likely overstate the benefits.

Are there any simple back of the envelope numbers you can share?


7 people like this
Posted by Marc
a resident of Midtown
on Sep 12, 2018 at 1:25 pm

@Tom DuBois

Basic question: Is it your view that once someone rents a residence they have the permanent "right" to stay there as long as they want. A landlord is forced to offer every existing tenant a new lease each time the current lease expires?

If a landlord decides for any reason not to renew a lease it is considered "eviction without just cause" and they must pay a fee for the tenant to leave.

So a renter, once they sign a lease the first time, now controls the property, not the owner of the property?

/marc




6 people like this
Posted by Apparently Not
a resident of another community
on Sep 12, 2018 at 1:43 pm

"Can't we all just get along?" - Rodney King


Like this comment
Posted by Anon
a resident of Another Palo Alto neighborhood
on Sep 12, 2018 at 2:10 pm

Posted by Train Fan, a resident of another community
^^^^^^^^^
I'm a train fan, too. But, your argument below ignores half the story, and is logically fallacious.

>> IF this statement is an accurate representation of Mr. Thornburg and/or city governments, then both are completely ignorant; that's not an insult, that's a fact.

>> For the past ~40 years, post-Prop13 revenue from California property taxes has increased on *average* by ~7.3% PER YEAR. That is a greater growth rate than inflation, and outpaces the State's economic growth during the same period.

This is true, but, it doesn't mean that Mr. Thornburg and I are "completely ignorant". You missed the whole point:

"While Proposition 13 limits taxes on any particular piece of property as long as it remains under the same ownership, taxable values are upgraded when it changes hands. That, along with ever-rising market values, accounts for much of the steady increase.

"Another big factor is new construction, both residential and commercial, added to the tax rolls as population increases. However it happens, property tax revenue keeps growing, currently by about $3 billion each year."

Web Link

>> The narrative that Prop 13 has starved California's government agencies of revenue is a tremendous lie foisted on Californians by pro-tax leftists, politicians and media, in the hope of convincing you to allow even MORE confiscation of your work and property.

If you are talking about me, I'm a liberal, not a "leftist"-- that is, I want the maximum personal individual freedom consistent with stable social cohesion. "Leftist" dates back to the communist era when authoritarian communism was seen by some as being "opposite" to authoritarian capitalism. I am opposed to authoritarianism, thank you. BTW, "your work and property" is very intertwined with everyone else's work and property. Go buy yourself a desert island if you don't like living and working with other people and paying taxes to support police and fire services which protect your work and property.

Specifically wrt your point: Palo Alto is a perfect example of soaring city revenue driven by commercial property development and high-end real-estate (re-)construction and sales. As in the cited articles, cities rake in a lot of cash for these developments, and, not so much from affordable housing development. Prop 13 has greatly distorted the real estate market.


8 people like this
Posted by Pat Burt
a resident of Community Center
on Sep 12, 2018 at 2:25 pm

Pat Burt is a registered user.

@former renter
First, I included some caveats because they are part of a full, fact based discussion of the topic. My broader view is that we need to reduce our rate of office/commercial development while increasing our housing and investing more in transportation. I also think that our large, highly successful tech companies need to bear more of the responsibility for mitigating the housing and transportation problems that they have largely created and benefited from.
To your specific question, as a Basic Aid school district, PAUSD gets over 75% of its revenue from property taxes. When residential development occurs it adds property taxes along with students to the district and corresponding expenses to educate them. When commercial development occurs, the district receives additional property tax revenue, but with no additional students or expenses added.


18 people like this
Posted by Margaret Heath
a resident of Evergreen Park
on Sep 12, 2018 at 2:55 pm

Margaret Heath is a registered user.

Palo Alto's property taxes are the major source of city revenue, but more than 70% of that comes from residential properties. The percentage of Palo Alto property tax that comes from commercial properties has declined steadily since Prop 13 passed, now down to approximately 27%, and will continue to do so.

Prop 13 has various loopholes that allow for commercial real estate transactions to be structured to avoid triggering a property tax assessment. For instance, if a commercial property is held in a corporation, a change of ownership within the corporation can be done in a way that does not trigger a new property tax assessment.

In addition, the fees the city requires for new commercial developments do not come close to covering the cost of these buildings to the city budget.


Like this comment
Posted by Me 2
a resident of Old Palo Alto
on Sep 12, 2018 at 3:03 pm

Train Fan: "People *assume* prop 13 starves governments of revenue: not true."

The issue isn't overall revenue.

-> it's the perversion of decision-making that has negatively impacted the housing and rental markets.

-> It's about the other kinds of taxes that have to levied to make up the revenue that also screw with market incentives.

The "starving of government revenues" is the wrong metric to measure the impact of Prop 13.


2 people like this
Posted by Anon
a resident of Another Palo Alto neighborhood
on Sep 12, 2018 at 3:17 pm

Posted by Me 2, a resident of Old Palo Alto

>> The "starving of government revenues" is the wrong metric to measure the impact of Prop 13.

Here is another take on exactly that question, from a couple of years ago:

Web Link

Note: as Margaret Heath noted, Palo Alto differs somewhat from statewide averages.

One point I haven't researched: if and when Prop 13 gets repealed, what would the equivalent average tax rate be to be revenue neutral? That is, on aerage, 1% goes to => ? %


22 people like this
Posted by Annette
a resident of College Terrace
on Sep 12, 2018 at 4:03 pm

Annette is a registered user.

We ought not lament what is happening at the Federal government level given what is happening here. Some posters are maligning Tom DuBois. I think that is unfortunate b/c he is easily one of the most unpolitical people on CC and I think that is a good thing. He's clearly not playing by the same rules as the majority of his colleagues. For that, I say thank you.

Electing career politicians and wannabes who use City Council as a stepping stone to higher office or egotists who are in office for glory rather than service gets us nowhere good. This is local government and those we elect should be focusing on city issues. We have a Board of Supervisors to handle regional issues and a State Legislature to handle even broader issues. Of course regional perspective and coordination is important but our City Council's first responsibility is to do all that it can to assure that Palo Alto is well run, well planned, fiscally sound, and well positioned for the future. To my way of thinking, that last part demands that we address our infrastructure shortcomings and make certain that we grow smartly and in a way that is sustainable.

I'll take a leader with courage over a politician with an agenda in a heartbeat b/c that person is much more likely to work for the best interests of the community rather than for whatever special interest group supports their candidacy.


26 people like this
Posted by Curmudgeon
a resident of Downtown North
on Sep 12, 2018 at 4:20 pm

"CC candidate Cormack says a lower office cap "limits our degrees of freedom."

I sure does. And it's long overdue.


36 people like this
Posted by Sheri
a resident of Midtown
on Sep 12, 2018 at 4:24 pm

Sheri is a registered user.

For those who keep calling Prop 13 a handout, every residence purchased since Prop 13 was passed is protected by it. That is, the annual real estate tax on a parcel of property is limited to 1 percent of its assessed value. Long time homeowners have benefited more, but EVERYONE is covered.


Like this comment
Posted by Me 2
a resident of Old Palo Alto
on Sep 12, 2018 at 4:45 pm

A handout is a handout. And worse - it's a handout for the landed gentry. Renters don't benefit from it.


8 people like this
Posted by Online Name
a resident of Embarcadero Oaks/Leland
on Sep 12, 2018 at 4:54 pm

Online Name is a registered user.

Me 2, are you equally insistent that commercial property owners and landlords also give up their Prop 13 rates? You do realize that companies "live longer" than individual property owners, right?

Since the share of taxes paid by commercial entities continues to decrease even while commuters continue to outnumber us, it really is relevant.


27 people like this
Posted by Landowners rights
a resident of Old Palo Alto
on Sep 12, 2018 at 5:05 pm

This issue started as a zoning issue, then became a low income shortage housing, and now it’s about renter protections. It looks we’ll be at a Prop 13 issue by end of week. The narrative switch has been comical.

The truth about the President residents is that very few of them are low income, hence the extreme push back on the means test (notice that no one is suggesting expanding this assistance to buildings with <50 units...sorry most renters). The Prez residents mostly live in the Prez for other reasons — community, convience, commuter housing, etc. (trust me, I was one of them).

This Prez residents are focused on getting paid....which is actually a rational, self-interested motivation (role call for Prez residents who showed up for the Buena Vista mobile home city council meetings...silence).

It’s a shame the City Council is simply responding to the loud, squeaky wheel with such reactionary policy decisions.

@Michelle Kraus — It looks like MP is *considering* those changes. If those interest you, move there. Similarly, if rent control interests you, move to EPA or SF.

The fundamental problem is a supply & demand issue, NOT a subsidy issue. Until there’s a comprehensive plan to address both commercial and residential growth, then the conversation devolves into the loudest, squeakiest wheel.


17 people like this
Posted by PASZ fan
a resident of University South
on Sep 12, 2018 at 5:12 pm

Thank you PASZ!

However, I wish your initiative sought a building moratorium of all buildings until traffic and parking issues are resolved, park space caught per resident.

3 cheers for Palo Altans for Sensible Zoning!


2 people like this
Posted by The Truth Will Set You Free
a resident of Meadow Park
on Sep 12, 2018 at 5:57 pm

[Post removed.]


2 people like this
Posted by Me 2
a resident of Old Palo Alto
on Sep 12, 2018 at 6:12 pm

"Me 2, are you equally insistent that commercial property owners and landlords also give up their Prop 13 rates?"

Yep. Have said so many times before. Every part of Prop 13 has completely messed up the housing market. I don't make the distinction between residential or commercial.


22 people like this
Posted by Train Fan
a resident of another community
on Sep 13, 2018 at 9:28 am

Anon, a resident of Another Palo Alto neighborhood, wrote:
"your argument below ignores half the story"

Excuse you. I responded to a specific statement (that I quoted precisely and you excluded in your response) with a specific response.



"[your argument] is logically fallacious."

Perhaps you don't understand the definition of 'fallacious', so let me help you:

fallacious: To base something on a mistaken belief.

Let's see if you can back that assertion up...



"'post-Prop13 revenue from California property taxes has increased on *average* by ~7.3% PER YEAR.'"

"This is true"

Thank you.



"You missed the whole point" (then proceeds to provide a quote unrelated to the statement I responded to)

It's you that missed the whole point, my friend :) Here is the exact quote I responded to:

'It’s financially bad for cities to want residential units," he says, "and as a result of that, every city is biased against wanting housing.'

Given the data provided in this thread (specifically that the average growth rate for property taxes is ~7.3%, with the bulk of that increase likely coming from residential real estate, given its high percentage of overall revenue), the notion that residential units are 'bad for cities' financially is flat-out false, which makes Mr. Thornburg's statement 'completely ignorant' of a very relevant, critical and indisputable fact.



So, given that your 'fallacious' assertion was proven false, I'm expecting your response to be one or more of the following:

* Pivot away from this aspect of the topic entirely;
* Throw up a strawman;
* Don't respond at all;
* Wordsmith parsing of the original quote I responded to;


4 people like this
Posted by Curios
a resident of Downtown North
on Sep 13, 2018 at 12:51 pm

@ curmudgeon
You say:
"CC candidate Cormack says a lower office cap "limits our degrees of freedom."
Is that an actual quote? If it is, where was it made? I’d be more concerned about her if that’s an accurate statement.


13 people like this
Posted by Online Name
a resident of Embarcadero Oaks/Leland
on Sep 13, 2018 at 1:16 pm

Online Name is a registered user.

""CC candidate Cormack says a lower office cap "limits our degrees of freedom."
Is that an actual quote? If it is, where was it made? I’d be more concerned about her if that’s an accurate statement."

It's an actual quote from the front page of the PA Post on Thursday, 8/30.


12 people like this
Posted by Another Wolbach betrayal
a resident of Crescent Park
on Sep 13, 2018 at 3:53 pm

Thanks to Tom DuBois for telling us what happened while planning the Colleagues Memo:

>When Councilmember Wolbach signed on to the colleagues memo, he and I discussed that council discussion should consider the full range of renter protections available in California including a discussion about just cause evictions and yes, rent stabilization. He agreed and suggested we remove mentioning those items in the memo explicitly in order to get Council support, but that they would be included.

>After the memo was submitted, Councilmember Wolbach spoke publicly multiple times saying the memo excluded just cause eviction and rent control, contrary to our prior discussion.


1 person likes this
Posted by Anon
a resident of Another Palo Alto neighborhood
on Sep 13, 2018 at 3:54 pm

Posted by Train Fan, a resident of another community

>> Excuse you.

E contrario. Excuse -you-.

>> "[your argument] is logically fallacious."

Yep. You assume that rising-property-tax => must-be-fiscally-beneficial (in the sense of fiscally beneficial for a city). That is a statement that does not follow logically, and, needs proof. You may think it is "common sense", but, not only my previous source, but, many other sources argue otherwise. Here is one: The California State Legislature's Legislative Analyst's Office.

Web Link

Quoted section follows:

California Communities Often Benefit More From Commercial Development.
======================================================================

In California, cities and counties typically find that commercial developments—particularly major retail establishments, auto malls, restaurants, and hotels—yield the highest net fiscal benefits. This is because the increased sales and hotel tax revenue that a city (or, in the case of a development in an unincorporated area, the county) receives from these developments often more than offsets the local government’s costs to provide them public services. As a result, cities and counties often encourage these types of commercial developments to locate within their jurisdictions—for example by zoning large sections of land for these purposes and by offering subsidies or other benefits to the prospective business owners.

In contrast, many California cities and counties find that housing developments lead to more local costs than offsetting tax revenues. This is because these properties do not produce sales or hotel tax revenues directly and the state’s cities and counties typically receive only a small portion of the revenue collected from the property tax. In addition, lower–density luxury housing often “pencils out” more favorably from a local government standpoint than higher–density moderate cost housing. This is because the luxury housing generates higher levels of property tax revenues per new resident.

Not surprisingly given these incentives, many cities and counties have oriented their land use planning and approval process disproportionately towards the development of commercial establishments and away from higher–density multifamily housing.

===========================================================================


4 people like this
Posted by Larry Serget
a resident of Stanford
on Sep 14, 2018 at 1:10 pm

Rent control rarely works to solve the underlying problem of increased JT housing supply.

Build more housing.

We should declare a state of emergency for both the housing and office space crisis.


20 people like this
Posted by Another Giveaway
a resident of Another Palo Alto neighborhood
on Sep 14, 2018 at 1:51 pm

@Larry,

There is no housing or office space emergency in Palo Alto (unless you are a developer).

Renting in Redwood City and wanting to own a home in Palo Alto is not an emergency. It sucks, but it is not an emergency. It is just the market telling you can't afford to live in Palo Alto.

Wanting to locate your corporate headquarters in Palo Alto but mot being able to justify the numbers is not an emergency. It sucks, but it is just the market telling you to locate in Santa Clara where many of the new office towers are less than 40% occupied.

The only emergency is for developers who are running out of ways to profit from exploiting the common assets built by Palo Alto taxpayers to launder the ill gotten gains of extra-national criminal elites.


12 people like this
Posted by Train Fain
a resident of another community
on Sep 14, 2018 at 2:05 pm

>>> Excuse you.
>> Excuse -you-.

Ah, mocking by repeating what I say. My 4-year-old daughter does that sometimes. It's her tell that she's upset and has run out of ideas to convince us to her way of thinking. :)


"You assume that rising-property-tax => must-be-fiscally-beneficial"

This is a Strawman logical fallacy. Here's the definition of a Strawman:

Strawman Fallacy: Substituting a person's actual position or argument with a distorted, exaggerated, or misrepresented version of the position of the argument.

I neither asserted nor implied nor assumed such a thing; you incorrectly inferred it.

Lets look...yet again...at the quote YOU provided which I responded to:

'It’s FINANCIALLY BAD for cities to want residential units," he says, "and as a result of that, every city is biased against wanting housing.' [emphasis mine]

This is a faulty generalization (and exaggeration). It may be fair to assert 'some residential units can be financially bad for cities' or 'commercial real estate is typically more financially advantageous for cities on average than residential units' or some versions of the above. It is not reasonable to assert/imply that all residential units are bad; to make that case, the author owns the duty to prove all (or even most) residential units are 'financially bad' for cities.

What's interesting is that your followup source effectively affirms this. Note the heavy use of 'typically', 'often', and 'many' in an effort to not promote a faulty generalization; the quote you provide from the original author does not make any effort to avoid a faulty generalization. And I'm calling you and him on it.

The faulty generalization makes the statement wrong; it's just that simple.

By the way, it's worth pointing out that the way data is categorized can skew unreasonably towards pro-commercial development. The article below points out that financial analyses of commercial-vs-housing development may under-represent the positive financial contributions of housing:

"One of the more significant factors that contributes to the perception that residential uses do not support themselves is the way most fiscal analysis studies treat revenue generated by sales taxes. Almost all studies of the fiscal impacts of various uses attribute retail sales tax revenues to where the sales take place, i.e., to commercial uses. Rarely do these studies attribute any retail sales tax revenues to residential uses. However, most retail sales are driven by the residential sector — businesses only take advantage of the increase in their market created by residential growth. More houses mean more sales tax revenues."

(source: Web Link )


Don't miss out on the discussion!
Sign up to be notified of new comments on this topic.

Email:


Post a comment

Posting an item on Town Square is simple and requires no registration. Just complete this form and hit "submit" and your topic will appear online. Please be respectful and truthful in your postings so Town Square will continue to be a thoughtful gathering place for sharing community information and opinion. All postings are subject to our TERMS OF USE, and may be deleted if deemed inappropriate by our staff.

We prefer that you use your real name, but you may use any "member" name you wish.

Name: *

Select your neighborhood or school community: * Not sure?

Comment: *

Verification code: *
Enter the verification code exactly as shown, using capital and lowercase letters, in the multi-colored box.

*Required Fields

He said – she said – who is lying? Justice Brett Kavanaugh or PA resident Christine Ford
By Diana Diamond | 71 comments | 2,917 views

Global Warming Diet
By Laura Stec | 7 comments | 1,316 views

Couples: "Taming Your Gremlin" by Richard Carson
By Chandrama Anderson | 0 comments | 1,191 views

Preparing for kindergarten
By Cheryl Bac | 0 comments | 661 views

 

Pre-registration ends today!

​On Friday, September 21, join us at the Palo Alto Baylands for a 5K walk, 5K run, 10K run, or—for the first time—half marathon! All proceeds benefit local nonprofits serving children and families.

Learn More